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Obama, Boehner Talk Fiscal Cliff; Geithner Is Fiscal Cliff "Point Man"; U.S. Economy Expanding; Two Powerball Winners Split Jackpot; Journalist and Fox Spar On Air and Off; Rebels Say They Shot Down Helicopter

Aired November 29, 2012 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


CAROL COSTELLO, CNN ANCHOR: And good morning. Thank you so much for being with me. I'm Carol Costello. Politicians and pundits alike have their eyes on Washington where in a few hours President Obama will welcome his former rival, Mitt Romney. We're going to talk about that luncheon in just a second.

But first, we are learning that President Obama had a lengthy phone call with House GOP leader, the Speaker, John Boehner. Dan Lothian is at the White House. Dan, what do you know?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Well, this is the second phone conversation now that the president has had with Speaker Boehner with regards to the fiscal cliff. This call, according to a source familiar with it, told me it lasted for 28 minutes.

This official saying that it was hardly short or curt, as had been reported by some news outlets and my colleague, Jessica Yellin, also heard from another source familiar with that phone conversation that said that the president told Speaker Boehner that he felt that rates had to go up on wealthy Americans and that there would be no deal without that.

So clearly, there is still some distance between the two sides here, the president believing that wealthy Americans need to pay more, those Bush era tax cuts should not extend for them and Republicans believing that all Americans should benefit from those tax cuts and that now you should put entitlements on the table.

As we see, the officials from the White House going up to Capitol Hill today, Treasury Secretary Timothy Geithner, to try to hammer out some deals, still, both sides far apart.

COSTELLO: Well, I want to talk about that a little bit. There was an article on politico.com this morning that said the two sides are farther along with a deal than we know and that all of this stuff that you're hearing out in the public view is just posturing. What are you hearing, Dan?

LOTHIAN: Well, you know, we certainly -- I think everyone hopes so, that they are closer to a deal. I mean, what you're hearing is some people are optimistic, including the president, saying he's optimistic this can get done, even before Christmas. But then you have others stepping up and saying that both sides are far apart, and very pessimistic that this can get done. As I stated, there's still some very strong views about what each side is holding to and refuses to give up.

The president refusing to give up an those wealthy Americans getting tax extensions. So, you know, it does appear, when you look at it, that there are those who believe that this can get done. There are those who believe that it can't -- where is the truth? We have to wait and see as the clock winds down.

COSTELLO: Yes, the clock is winding down fast now. Dan Lothian, you're going to talk about the luncheon later on in the program.

LOTHIAN: That's right. We'll come back for that.

COSTELLO: We look forward to that. Dan mentioned Treasury Secretary Timothy Geithner. Well, he is being called in as President Obama's point man on the fiscal cliff negotiations. He'll meet with congressional leaders this afternoon, Republican Representative Tom Cole.

(BEGIN VIDEO CLIP)

REP. TOM COLE, (R) OKLAHOMA: We have lots of leverage in this negotiation. Nobody wants the spending cuts, particularly Democrats on the domestic side, to go in place. This doesn't deal with that. We still have plenty of leverage in the negotiation. I actually think the American people, number one, should never be used as leverage in a negotiation.

(END VIDEO CLIP)

COSTELLO: Yesterday, President Obama met with corporate CEOs who said that a compromise is essential to avoiding the so-called fiscal cliff. Here is Goldman Sach's CEO, Lloyd Blankfein.

(BEGIN VIDEO CLIP)

LLOYD BLANKFEIN, CEO, GOLDMAN SACHS: If this were easy, we wouldn't be standing here having confabs at the White House about how to achieve it. It's going to be difficult. I think what we try to do is we try to get in as good a place as we possibly can. I would rather have more of the -- more of the taxes deferred to beyond the period where the economy is weak.

(END VIDEO CLIP)

COSTELLO: Well, maybe all of this is working. Markets around the world are up today, a sign of confidence that a fiscal cliff deal just might be in the works. We'll see.

Another positive sign for the economy, the broadest picture we can get of the economy's health, GDP, came in quite a bit better than expected in the third quarter. Alison Kosik at the New York Stock Exchange to explain. Hi. ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Hi, Carol. So between July and September, the economy grew at a 2.7 percent rate. So that came in much better than second quarter's rate, which was 1.3 percent. And there's definitely good stuff here.

You look deeper in the report. You find out that the U.S. exported more than first thought. That's good because we really need people in other countries to buy our stuff. That helps our economy. Home building and strong corporate profits that also helped our economy, but here's the thing.

When you dig deeper in the report, past that headline number of 2.7 percent, you know, it's not all it's cracked up to be. Businesses built up bigger inventories of their products last quarter. That helps the economy now, but the thing is, it means next quarter these businesses may not buy as much.

Also, this increase in inventory may be because these products are just piling up and no one is buying them. Also, corporate America isn't spending much on much else. Computer and equipment purchases, they're down because they're not sure where the economy is headed.

And consumers aren't spending as much as first estimated, either. So there's a little good, there's a little kind of bad in the report -- Carol.

COSTELLO: Yes. I was going to ask you, what does this all mean as far as the fiscal cliff goes anything?

KOSIK: Well, you know this. The fiscal cliff is going to have a huge impact on the economy. In fact, a big European economic group this week dialed back its estimates for U.S. economic growth this year. And other economists are warning that things may not be so rosy, partly because of concerns about the cliff.

Now, businesses are already cutting back, even though corporate profits are up. And when you look at today's report, here's the interesting part, Carol. Government spending, federal government spending is a huge reason why the economy grew in Q3.

It rose 9.5 percent, but here's the thing. If you slash that government spending, if and when the fiscal cliff goes into effect, that can really eat into GDP and is part of the reason the Congressional Budget Office has said if we do go over the cliff, the U.S. could go back into a recession -- Carol.

COSTELLO: Alison Kosik at the New York Stock Exchange.

Well, someone is waking up this morning as a multimillionaire. Winning tickets for the Powerball's record-breaking $580 million jackpot were sold in Arizona and Missouri. Last night's winning numbers, if you're curious, 5, 23, 16, 22, 29 and the Powerball number is 6.

Winners will split the largest jackpot in Powerball's history. We know one of the tickets was bought around the Kansas City area. But whoever won was really lucky, because the odds of winning, 1 in 175 million. You have a much better chance of getting hit by -- we say that every time. You know, the odds are long. Lucky them and we're happy for them.

Journalist Tom Ricks is a star. Not for his new book, not for his 17 years at "The Wall Street Journal," but for his 90 seconds on Fox News. When asked about the attacks on the U.S. Consulate in Benghazi and claims the Obama administration whitewashed it, Ricks employed an "Earth to Fox" maneuver.

(BEGIN VIDEO CLIP)

TOM RICKS, JOURNALIST/AUTHOR: I've covered a lot of fire fights. It's impossible to figure out what happens in them sometimes. And second, I think that the emphasis on Benghazi has been extremely political, partly because fox was operating as a wing of the Republican Party.

JON SCOTT, FOX NEWS ANCHOR: All right, Tom Ricks, thanks very much for joining us today.

RICKS: You're welcome.

(END VIDEO CLIP)

COSTELLO: Fox abruptly ended that interview. You saw that, after a mere 90 seconds, but Ricks did not back down. Listen to his reaction when "The Huffington Post" reads him Fox's public statement after that interview. It's really more of a public smackdown. Listen.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Here we have a statement from Michael Clemente, the executive VP at Fox News Channel. He said when Mr. Ricks ignored the anchor's question, it became clear his goal was to bring attention to himself and his book. He apologized in our offices afterward, but doesn't have the strength of character to do that publicly. Your reaction.

(END VIDEO CLIP)

COSTELLO: All right, then, Howie Kurtz from the "Daily Beast" and CNN's "RELIABLE SOURCES" is here with us. Welcome, Howie.

HOWARD KURTZ, CNN HOST, "RELIABLE SOURCES": Thank you.

COSTELLO: So Ricks has become the star du jour. His appearance on Fox News has hundreds of thousands of views on YouTube. Some say he planned this whole thing. I mean, was this his "I'm mad as hell" moment?

KURTZ: I don't think Tom Ricks planned anything, but he did take quite a provocative swipe at Fox News. The reason this has gone viral, the reason for all the YouTube attention, the reason we're still talking about it, is because the Fox anchor, Jon Scott, gave him the hooks. Because he dared to criticize Fox News coverage of the Libya situation that was deemed unacceptable, and in effect, he was tossed off the air.

COSTELLO: It would have been such an interesting conversation. So I'm wondering -- like if he said a similar thing on CNN, I would talk to him about it.

KURTZ: This is exactly the point that I've been trying to make. And I put this to Fox News, and Michael Clemente, the executive vice president mentioned earlier, said, well, that's not Jon Scott's style and maybe he should have. He was offended that Ricks seemed to be calling attention to himself.

Imagine, a guest coming on TV with a book, calling attention to himself.

What really happened here is that Fox, I guess like a lot of news organizations, doesn't like to be criticized. But this could have been a really interesting, provocative discussion. If Ricks takes the position that the whole coverage of Benghazi, while obviously it's a serious and legitimate issue with four American diplomats dead, has been hyped for political reasons by Fox News, certainly the anchor could have pushed back on that. Instead, by cutting the interview short, Fox sent the signal, I believe, that it's kind of defensive and thin-skinned when it comes to criticism, even though, as you know, journalists love to criticize everybody else.

COSTELLO: Well, yes, it's a sport with us. The Fox-bashing (ph) MSNBC invited Ricks to be on, and Ricks said, quote, "You're just like Fox, but not as good at it." So is he now playing -- Ricks I'm talking about -- is he now playing this for all its worth? Or are we all just revealing in his refreshing honesty?

KURTZ: I would say the answer is both, Carol. It is an interesting spectacle to see a journalist -- usually journalists don't like to insult television networks, because they want to get on. They want to sell their next book. They want to get the visibility.

Tom Ricks, I know him for years, he worked at "The Washington Post," very blunt-spoken guy so he was perfectly willing to stick it to MSNBC as well as Fox News. But in fairness, we're all calling him up. I had him on "RELIABLE SOURCES" on Sunday, he's responding to our questions.

It's just such an interesting moment when somebody attempts to push back against a way in which a television network, in this case Fox, has framed a particular story, that that becomes the story, rather than Libya and the coverage of Libya itself.

COSTELLO: Which is actually kind of sad, right?

KURTZ: It is kind of sad.

COSTELLO: Howie Kurtz, thanks so much.

The battle for Syria moves from the ground to the sky as Syrian rebels claim to have shot down several aircraft over a 24-hour period. We have new video from inside the region. (COMMERCIAL BREAK)

COSTELLO: The U.S. could soon become more involved in another Middle East fight, this time, Syria. According to the "New York Times," the Obama administration is deciding if it should play a more direct role to overthrow the Syrian President Bashar Al Assad.

Right now, the United States is just giving humanitarian aid to that country. In the meantime, rebel forces take their fight with the Syrian army to the skies. They shot down a helicopter, supposedly, using a rocket. The video was then posted on YouTube.

CNN cannot independently confirm this video is authentic, but you could hear the rebels are cheering after that rocket hit the helicopter. And as Arwa Damon found out, rebels say they shot down three fighter jets in the past days.

(BEGIN VIDEOTAPE)

ARWA DAMON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Children on the back of a tractor make off with a sizeable tangled lump of metal. What was all too often the cause of nightmares, now a trophy of war proudly shown off.

We want to take these pieces to show them to the other villages, he says. Let them see what happened to these planes. Everyone we speak to here describes the fear they felt, any time they heard a jet overhead. For them, this is the greatest victory.

(on camera): One man who we spoke to said he was picking olives, that he saw the plane being hit, and the two pilots ejecting. He says at that point everyone fanned out, looking for them. He and others are telling us, one pilot was found unconscious with a head injury.

(voice-over): Video posted to YouTube shows a man in military uniform, seemingly unconscious, being carried away. As a man off camera states, here is the pilot who is shelling the houses of civilians. Another clip is of him in a makeshift field clinic. Head bandaged.

A voice says, this is the fate of your pilots. And this is not an isolated incident. In the same vicinity, close to the city, in the span of 24 hours, rebels claim they not only brought down this fighter jet, but also two helicopters.

Video posted to YouTube shows a trail of smoke and a helicopter bursting into flames. But there's no way for us to confirm when and where this happened. These dramatic developments are a result of a pitched battle fought here at the 46th regiment base, just over a week ago.

For nearly two months, (inaudible) tells us, they laid siege to the base, after clearing the villages around it of Assad's forces and positioning rebel snipers in the area. The final battle to take this massive base lasted 24 hours. Rebel fighters used artillery they captured from another unit on the base, firing it into the building and ending the battle.

For this rebel unit, there was a treasure trove of weaponry, and most important of all, anti aircraft missiles, hundreds of them. Though not all functioning, the fighters tell us. Video posted to YouTube right after the assault took place shows stacks of metal boxes packed with soviet era anti aircraft missiles.

The regime still has the military advantage, thanks to the sheer size of its arsenal. But the balance, it seems, may have ever so slightly shifted. Arwa Damon, CNN, Aleppo Province.

(END VIDEOTAPE)

COSTELLO: A month ago, this meeting seemed inconceivable, but what should come of the Obama-Romney luncheon? Our "Talk Back" question for today.

(COMMERCIAL BREAK)

COSTELLO: Now is your chance to talk back on one of the big stories of the day. The question for you this morning, what should come of the Obama-Romney luncheon? Awkward! President Obama, Mitt Romney, a luncheon of rivals? Who can forget the two on the debate stage, prowling and pointing, the bitter rivalry spawning tortured catch phrases.

(BEGIN VIDEO CLIP)

BARACK OBAMA, (D) PRESIDENT OF THE UNITED STATES: We've got a -- we've got to name this condition that he's going through. I think -- I think it's called Romnesia. It's like Robin Hood in reverse. It's Romney-hood.

MITT ROMNEY, (R) FORMER PRESIDENTIAL NOMINEE: We've been watching the president say a lot of things about me and about my policies and they're just not right. And if I were to coin a term, it would be Obamaloney.

(END VIDEO CLIP)

COSTELLO: Remember that one? Now the man who accused the other man of giving away free stuff may just dine on Obamaloney.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Here's what I don't get. The last eight months, Mitt Romney has been saying nobody should get a free lunch. Now he's going to the White House to have a free lunch.

(END VIDEO CLIP)

COSTELLO: We laugh, but what if? What if Mr. Obama asked Mr. Romney to play an important role going forward? Even the president has acknowledged Romney's skill in making things, like the Olympics, run better. But the track record for post election powwows is not exactly good. After the 2008 election, McCain and Obama met and vowed to work together on economic issues and look at them now. They're not exactly best buds. Just say the word Benghazi, and watch the sparks fly.

Still, it could be a win-win for both men. For Obama, a chance to show a bipartisan spirit and for Romney, a chance to rehabilitate his image after being excoriated by both Democrats and Republicans for saying Americans who voted for Obama wanted free stuff.

So the "Talk Back" question today: What should come of the Obama- Romney luncheon? Facebook.com/CarolCNN. Your comments later this hour.

(COMMERCIAL BREAK)

COSTELLO: And good morning. Thank you so much for being with us. I'm Carol Costello. You're watching CNN NEWSROOM. It's just about 30 minutes past the hour.

To Washington now, where in just about two hours, President Obama will sit down to lunch with his former rival, Governor Mitt Romney. White House correspondent Dan Lothian has more on just how this came about.

(BEGIN VIDEOTAPE)

LOTHIAN (voice-over): Even political statistician Nate Silver, who correctly predicted the election results, doesn't quite know how this will turn out. Although we can all assume the tone will be much different than the last time President Obama and Governor Mitt Romney met.

OBAMA: Not true, Governor Romney.

LOTHIAN: Mitt Romney travels to Washington, where he will break bread with the man who dashed his hopes of becoming commander in chief, President Obama.

UNIDENTIFIED MALE: That's good. It's nice to see the president reaching out to the unemployed. That's what I like.

UNIDENTIFIED MALE: Yes, in a related story, Romney sent an e-mail to all his donors with the heading, "See, I am headed to the White House! It's just the way I thought I would."

LOTHIAN: We got a hint of this potential face-to-face sitdown on election night.

OBAMA: I also look forward to sitting down with Governor Romney to talk about where we can work together, to move this country forward.

LOTHIAN: One of the ways the president may try to move forward is by tapping into Romney's business experience. As issues like the fiscal cliff, unemployment and the deficit loom, but while there will be several openings in the Obama cabinet for the second term, White House Press Secretary Jay Carney says Romney is unlikely to fill them. UNIDENTIFIED MALE: Is Governor Romney here tomorrow in some kind of cabinet-level position, some kind of audition for that position?

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: No.

LOTHIAN: And some think President Obama could be aiming a little higher than a cabinet post.

UNIDENTIFIED MALE: And after three weeks of dealing with the Benghazi scandal, and the fiscal cliff, Obama is prepared to offer Romney a position in the administration, president of the United States. He's like, I made a mistake. It's all yours. Why, thank you.

LOTHIAN: All jokes aside, this meeting of the political minds could be beneficial for both men. For the president, it is a chance to show he's put a tough campaign behind him and is taking a bipartisan approach to his second term.

And for Romney, it's an opportunity to rehabilitate his image, which took a hit shortly after the ballots were counted, thanks to remarks made on a conference call with donors. Quote, "The Obama campaign was following the old playbook of giving a lot of stuff to groups, specifically the African-American community, the Hispanic community, and young people."

Those comments had many Republicans rushing to distance themselves from their former nominee. But one Romney strategist offered this defense of his former boss in the "Washington Post."

Stuart Stevens wrote in part, "Losing is just losing. I would hope it's not seen as an excuse to show disrespect for a good man who fought hard for values we admire."

As for today, there's no word yet about what's on the menu, but don't expect any scenes like this one. That's right. No beer summits. Romney doesn't drink.

And since the event is closed to the press, we may not ever know what words were spoken between the former competitors. If only White House walls could talk.

(END VIDEOTAPE)

COSTELLO: If only. Dan Lothian reporting. Joining me now is Sean Spicer, the communications director for the Republican National Committee. Welcome, Sean.

SEAN SPICER, COMMUNICATIONS DIRECTOR, REPUBLICAN NATIONAL COMMITTEE: Good morning, Carol.

COSTELLO: Good morning. You know, everybody is joking about this. It's just become this big joke. Should it be, this luncheon?

SPICER: No. I think it's actually a very nice part of modern American history, where the two candidates get together and show what a great country it is that you can go at it during a political campaign, present ideas to some degree, you know, talk about the other candidate. And then sit down afterwards as two civilized adults, come together for the good of the country, and show how great our process and our democracy is.